First, they beat estimates by a nice margin on both revenue and EPS. Second, if you listened to the call, the mix is shifting more to licensing as their mobile business is growing strongly. Third, if global consumer electronics pick up even a little, this company will benefit strongly given the operating leverage of the business.
The valuation is dirt cheap for a business that generates high margins and free cash flow. The EV/EBITDA is barely over 6x, which basically assumes no growth for an extended period. The company has a over $7/share in cash and investments, so there is plenty of room for another special dividend or an enlarged buyback.
This is a defensive business with a lot of upside potential. Based on the current outlook, in my opinion, the stock should be trading at $40.
#$%$ dee doo, they beat reduced estimates. so now suddenly they are worth more than last year when revenue and profit was 30% higher?
Plus guidance is for 20% lower revenue in the third quarter.
Chasing a dream there bucko.